Japanese lenders lead the way as stocks keep climbing

BLOOMBERG

Asian stocks rose for a second week. Japanese lenders such as Mizuho Financial Group Inc gained after Shinsei Bank Ltd said first-half profit rose and Standard and Poor's raised some of their credit ratings.

"Japanese banks have made a lot of progress and are looking for ways to improve their profitability," said Takashi Miyazaki, a Tokyo-based senior strategist at UFJ Partners Asset Management Co, which helps manage US$8.6 billion in equities. "That's what makes them appealing to some investors."

Morgan Stanley Capital International's Asia-Pacific Index, which tracks more than 900 stocks, jumped 2.4 percent to 99.21, the highest since November 2000, in the five days ended on Friday.

The regional benchmark climbed 3.6 percent last week, its biggest jump since the five days to May 21.

The MSCI index that tracks financial stocks in Asia was the best performer in the regional benchmark this week, led by Mizuho and UFJ Holdings Inc. The MSCI Asia-Pacific Financials Index climbed 3.3 percent.

BHP Billiton, the world's biggest miner, and Posco, South Korea's largest steelmaker, rose as investors bet they will be able to pass on higher costs of raw materials next year.

In Hong Kong, property stocks such as Cheung Kong Holdings Ltd advanced after the government postponed the listing of a US$2.7 billion property fund due to a legal challenge and returned money to investors.

Japan's Nikkei 225 Stock Average jumped 2.6 percent this week and the broader Topix index added 2.1 percent. Both benchmarks rose for a second week.

Australia Gains Australia's S&P/ASX 200 Index ended the week at a record high after rising above 4000 for the first time on Dec. 21. It is set to complete its best year since 1993.

All other stock benchmarks in the region rose apart from those in China and Singapore.

Shinsei, the first Japanese lender to be bought by overseas investors, said it had net income of ¥40.8 billion (US$391 million) in the six months ended Sept. 30 from ¥34 billion a year ago, citing investment banking and consumer finance earnings. The stock climbed 2.1 percent to 690 yen, its second weekly gain.

Japanese banks are expanding in consumer finance and fund management as the government eases restrictions on their business scope. Japanese individuals have about ¥1,412 trillion of financial assets.